India will be looking to ship in more crude oil from Saudi Arabia and the United Arab Emirates to fill part of the vacuum created by reduced appetite for supplies from Iran, which is facing US sanctions, according to delegates and policy makers attending the India Energy Forum by CERAWeek. Although Indian government officials remained tight-lipped about the exact strategy that Indian refiners would adopt after the winding down period ends early November, many delegates at the India Energy Forum told S&P Global Platts that inflows from Iran are unlikely to fall to zero.
Both Saudi Arabia and the UAE highlighted that they had spare capacity to produce the incremental barrels to supply to leading global crude buyers, including India. Saudi Arabia’s energy minister Khalid al-Falih pledged his country’s “full commitment to meeting India’s oil demand” and said he wanted to reassure consumers that any supply shortfall would be met, adding that current market fundamentals were in balance.
“We are in close contact with all major consumers to seek their views and listen to their concerns and take those into consideration as we set the kingdom’s energy policy and discuss it with our partners in OPEC and outside of OPEC,” he said, adding that he had met with Indian Prime Minister Narendra Modi and oil minister Dharmendra Pradhan on Monday. “I want to assure you of our commitment to supply your energy needs, especially oil, and more broadly to promote market stability and to offset any market shortfall,” Falih added. He added that Saudi Arabia, which is currently producing about 10.7 million b/d, would raise its crude production next month. US sanctions on Iran go into effect November 5.